If the Rudd government's profligate spending on various bailouts wasn't enough, this new outrage largely passed under the radar. Now he has found a new object for his compassion in car dealers, used car dealers at that. Who are now due to be the lucky recipients of $2 billion, assuming their credit rating isn't very good.

As reported in SMH, Rudd's $2b plan to save car dealers:

THE Federal Government has pressured the big four banks into providing a $2 billion lifeline to stop hundreds of car dealers from going out of business in the latest attempt to insulate Australia from the global financial crisis.

The Treasurer, Wayne Swan, met the heads of Westpac, ANZ, NAB and the Commonwealth Bank yesterday to finalise the plan which will be underwritten by government guarantees of the riskiest of the planned loans to car dealers.

Mr Swan said the car industry played a vital role in the economy and the plan to help dealers would support a stable and viable future for the industry.

And:

Under the scheme, the banks and the Government will set up a financing trust to provide credit to new and used car dealers as well as traders in trucks, motorbikes, boats and caravans.

The banks will inject about $2 billion into the trust. In return the trust will issue the banks and other investors with securities.

The Government will not contribute taxpayer funds directly but will guarantee the interest and principal on any of the loans with a credit rating below AAA. Mr Swan said this was expected to be "a minor proportion" of the $2 billion worth of finance.

A well-placed source said this proportion would be between 10 and 20 per cent - up to $400 million.

For a person with a poor grasp of economics, the $6.4 billion bailout for the local car manufacturers probably at least sounds plausibly sensible. After all it's difficult to reestablish manufacturing once it's gone, with a lot of skills and infrastructure necessary to carry out modern industrial production. Hence this intuitive view, as incorrect as it may be, can at least be credited with some superficial degree of justification. But car dealers? Middle-men?

How on earth are salesmen so valuable, so irreplaceable, that Rudd imagines they are a national asset? If Australia lost every car dealer tonight through mass UFO abductions, by mid tomorrow morning every last one of them would all be replaced by new applicants. And what is a car dealership exactly? An empty lot where cars are parked. Is Rudd worried that vacant lots will be hard to replace at a future date when the industry is healthier?

A bailout for car dealers is like passing a law to protect cane toads.

So what is the next step here? Now that Rudd has subsidised the manufacturers, now the dealers, is it not therefore logical to start subsidising the customers? Like a first home owners grant, but for cars. I predict this will come to pass.

I also predict that very soon Rudd will initiate a bailout for real estate agents.